ANNAPOLIS, DEC. 6 -- Maryland Gov. William Donald Schaefer, confronting an increasingly grim economic landscape, announced plans today to lay off up to 1,800 state workers on Jan. 1 and to dip for the first time into a "rainy day fund" to avoid a deficit.

Schaefer resorted to the state government's first blanket layoff in at least four decades after analysts projected a $423.2 million shortfall in Maryland's $11.5 billion budget.

"This is the most difficult thing I've ever had to do," said a stern-faced Schaefer, who served 15 years as Baltimore mayor and begins his second term as governor next month. "I've never laid off anybody, but we have to move now."

The governor ruled out calling for immediate tax increases, but added that the layoffs may increase pressure on lawmakers to push for additional revenue next year.

State Treasurer Lucille Maurer today compared the state's economy to a "toboggan slide."

Schaefer's ax would fall solidly on the Washington suburbs. Among $18.5 million in construction program reductions is nearly $2 million targeted to improve athletics facilities at the University of Maryland-College Park. If aid to struggling local governments is pared back, as he also proposed today, it would cost Prince George's County $4.3 million and Montgomery County $8.5 million this year.

Large portions of Schaefer's proposal must be ratified by the General Assembly after it convenes Jan. 9.

Schaefer, who in the past seldom has consulted lawmakers in advance on budget matters, said the layoffs would be dispersed throughout state agencies and would not be concentrated among lower-level jobs. Final recommendations on the precise level of layoffs will be left to department secretaries.

As Maryland's economy stagnated through the fall, earlier projections of income and sales tax revenue -- the basis of the current budget -- appeared wildly optimistic.

"We're downsizing government to fit the new realities," Maurer said.

Similarly, Virginia is attempting to trim $1.4 billion from its two-year budget to address a projected deficit. And all local governments in the Washington area are retrenching, with Prince George's County already announcing 190 layoffs.

Schaefer this morning met with leaders of the General Assembly to seek their support for tapping the rainy day account -- set aside for use in times of economic downturn -- and for diverting other funds earmarked for transportation programs, the purchase of parkland and farmland preservation. Those sources would yield $137.2 million toward the $242.6 million gap the governor moved to close today. Most of the remaining shortfall would be made up in layoffs and by trimming aid to local governments. Combined with a first round of cuts announced last month, his plans would match the projected deficit.

Legislative leaders said they plan to meet over the weekend and report back to Schaefer early next week.

"Layoffs are going to be a necessary component of this," said Senate President Thomas V. Mike Miller Jr. (D-Prince George's). "I don't see any need to increase taxes at this time. The voters said in November they want less government."

Del. Charles J. Ryan (D-Prince George's), a budget leader who met with Schaefer, said later that the news of planned cuts is particularly unpleasant coming during the holiday season.

"It's unfortunate that these economic times are so bad that we're going to have to look at doing away with programs and the people who provide them," Ryan said.

Officials at the Maryland Classified Employees Association were thunderstruck by Schaefer's announcement.

"We're going to work with the legislature to try to get as much emergency appropriation as possible to reduce the number of layoffs," said Jospeh H. Cook, director of field services for the association, which represents 22,000 of the approximately 60,000 employees eligible to be laid off.

Cook said the association also may challenge the governor's authority to bypass state personnel regulations and give employees only two weeks' notice rather than 90 days.

The Board of Revenue Estimates, which met this morning to deliver the latest projections, said employment in Maryland is expected to grow by only 0.6 percent during the 1990 calendar year and to decline 0.5 percent next year, the first drop since the recession of 1982.

From July through November, sales tax receipts grew 0.3 percent and revenue from individual income taxes grew by only 3.1 percent. Even improvements later next year would mean relatively little growth in state income.

State Comptroller Louis L. Goldstein said the economic outlook was the most bleak he had seen since 1938.

"This is the first time I've seen revenue drop off {so} quickly," Goldstein said.

Last month, Schaefer's first round of cuts trimmed $176 millon off the projected deficit -- largely by freezing hiring, limiting travel and cutting $43.4 million from the Department of Health and Mental Hygiene. The health cuts, which reduce reimbursements for such programs as indigent care and kidney dialysis, already have produced a rush of complaints.

When it became clear that a second, larger round of cuts would be needed, budget advisers said there was little alternative but to order employee layoffs.

Schaefer, seeking to involve the General Assembly in the painful choices, today laid out a variety of alternatives, including a plan that would involve no layoffs but would risk the state's bond rating by digging deeply into reserves.

If lawmakers do not agree to give Schaefer authority to spend some rainy day funds and corporate income tax revenue, the governor said up to 12,800 layoffs could be necessary.

Here is the proposal Gov. William Donald Schaefer submitted to Maryland General Assembly leaders to reduce the current state budget by $242.6 million. The cuts in the agencies and higher education would translate to layoffs of 1,800 state workers.

Agency reductions...........................................$33.9

Capital reductions...........................................18.5

Local payment cuts.......................................32.9

Health cuts...................................................4.0

Public higher education cuts.................................10.5

Scholarship cuts..............................................2.8

Private higher education cuts.................................2.8

Use part of "rainy day fund"................................75.0

Use corporate income tax normally devoted to transporation..22.2

Use funds earmarked for parkland purchase and farm

preservation.................................................40.0 TOTAL..........................................................$242.6

Requires approval of the General Assembly SOURCE: Department of Budget and Fiscal Planning